The Esports industry is fast growing with reports indicating that last year the number of global viewers of esports grew to around 380 million with the number expected to surpass 557 million global viewers by 2021. A report released by Newzoo indicated that the esport industry was expected to generate revenue of around $900 million last year with the figure expected to be in the region of 1.1 billion this year And by 2021 the figure will be around $1.65 billion.
The growing Esports industry
In an interview with Investing News Network at the beginning of the month, Trevor Doerksen the EPlay Digital Inc. (OTCMKTS:NWKFF) CEO provided insight on how the esports companies generate their revenue during the Esports and Capital Markets event that was hosted by the Canadian Securities Exchange. EPlay Digital is popular in the industry and already it has an app that focuses on the NBA basketball league.
Some of the big players in the esports industry include Enthusiast Gaming Holdings Ltd (OTCMKTS: EGHIF), Animoca Brands Corporation Ltd (OTCMKTS:AMOCF) and Riot Games. Besides the big companies the ETF space is also warming up to the esports frenzy and in May Evolve E-Gaming ETF became the first esports ETF in Canada.
Partnering with other companies
EPlay Digital has had various partnerships with clients such as Cineplex Inc. (OTCMKTS:CPXGF), ESPN and Intel Corporation. The CEO indicated that when developing apps for these companies and the games previously there was a sponsor and a client where ePlay’s responsibility was to get viewers which was a successful venture.
Trevor stated regarding the partnerships the company has had such as with Next Joy have been a revelation in generating of daily active user revenue besides the in app revenue. The CEO said that getting downloads is important because partners and celebrities are important and for a platform like Next Joy they get to access to its over 100 million users. And for the platform they can choose to promote a game such as Big Shot since their parent company Shanghai Media Group has the rights and they can broadcast it for free.
Partnership with celebrities
He also indicated that celebrities are important in the company’s model and its latest partnership is with a partner who has a clothing line. They will user her to sell the digital version of Big Shot which will attract 100% profits and revenue is shared with the partners. Trevor explains that the focus of the companies is to get users first before figuring out how to monetize them. Instead of paying celebrities endorsement ePlay Digital is partnering with them so that they can make money together in selling the product.
Revenue from cash prizes for games played
In Esports there is over $0.5 million in prize money available daily on casual games. with most games players can challenge each other and there are cash prizes to be won in casual games. Esports companies they get a share of the revenue while some is also given to the winner. For instance in Big Shots a player can unlock an advanced challenge to play for cash.